Safeway’s deal with union raises heat on Raley’s [The Sacramento Bee]
| By Dale Kasler, The Sacramento Bee | |
| McClatchy-Tribune Information Services |
Safeway, the second-largest grocer in the
With the Raley's walkout entering its sixth day today, the union's agreement with Safeway will put pressure on the
Striking workers will likely step up their efforts to persuade Raley's customers to shop instead at Safeway or the region's other unionized chain,
"I think Raley's is in a very tenuous position," said
Yet Raley's, which has kept all of its stores open, didn't sound like a company backed into a corner.
In a prepared statement Thursday, Raley's said the Safeway deal "has no impact on our ongoing contract dispute."
"We chose to negotiate on our own with the union because of our specific situation and need to reduce our operating costs," the company added.
Raley's says it is losing millions of dollars a year as it struggles against a wave of nonunion competitors.
The company disclosed Thursday that it has hired 500 replacement employees to work alongside union members who have crossed the picket lines. Although business has suffered because of the strike, Raley's says revenue has been improving in recent days.
Experts said Safeway, while facing many of the same competitive pressures as Raley's, remains profitable and can afford to be more generous with the union.
In particular, the
Normally, terms of a tentative contract aren't made public until workers have a chance to vote on it. This time, both Safeway and the
"Safeway agreed to retain and fund the union's health benefit plan, the same plan
"The only company remaining to sign on to the union's plan is Raley's," he added. "We will not let up on Raley's until they come to their senses."
Safeway regional President
The statement suggests Safeway did obtain cost savings from the union, but neither side would divulge details of the contract.
All three union grocers in the region, not just Raley's, say they need concessions.
Ratification of the Safeway deal, which could take several weeks, is no sure thing. Members of three bargaining units, Local 8 plus two locals in the
It took the union two tries to implement the
Safeway has been eager to reduce its labor costs in
Company spokesman
Still, Safeway is considerably healthier than Raley's and more capable of shouldering the expense.
With
Perhaps most important is
By contrast,
"The competitive pressures are exceptional in
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